Business linkages crucial for Red River Delta development

Minister of Planning and Investment Nguyen Chi Dung

Bottlenecks

The Red River Delta comprises 11 provinces and cities: Hanoi, Vinh Phuc, Bac Ninh, Quang Ninh, Hai Duong, Hai Phong, Hung Yen, Thai Binh, Ha Nam, Nam Dinh, and Ninh Binh (of these, Hanoi and Hai Phong are centrally governed cities). The Delta has a favorable geo-economic and strategic geo-political position for socioeconomic development and exchanges between the northeastern and northwestern regions, and between northern mountainous areas and the central region. Adjacent to the large Chinese market and northeast Asian countries, the Delta helps northern provinces promote trade with the world.

In recent years, some localities in the Delta, such as Bac Ninh, Vinh Phuc, Hai Duong, and Hung Yen, have achieved breakthrough growth. The regional economy grew an average 8.93 percent annually from 2005 to 2022, higher than the country’s average. Its gross domestic product (GDP) has increased rapidly and reached VND2.89 quadrillion in 2022, accounting for 30.4 percent of Vietnam’s GDP. Its per capita gross regional domestic product (GRDP) has reached VND123.4 million per year, 1.3 times higher than the country’s average. Domestic and foreign investment in the region has increased strongly, with foreign direct investment (FDI) constituting 31.4 percent of Vietnam’s total.

Deputy Minister of Industry and Trade Do Thang Hai

Despite these positive results, at a recent workshop to discuss how to promote investment, trade and services and create regional business linkages, Deputy Minister of Industry and Trade Do Thang Hai said the cooperation between localities in the Red River Delta remains weak and unplanned, lacking official mechanisms. Notably, he added, localities in the Delta still have almost no linkages with provinces and cities in other regions.

“Each locality has yet to build goods supply chains and market linkages for each sector/group of products to enhance the competitiveness of the regional economy,” said Le Viet Nga, Deputy Director of the Domestic Market Department of the Ministry of Industry and Trade.

Representatives of ministries, sectors and localities attend the workshop

According to Deputy Minister of Planning and Investment Nguyen Thi Bich Ngoc, the Red River Delta still faces three problems: (1) planning, (2) mechanisms and policies, and (3) investment shortage, especially in infrastructure, with many projects on the priority list delayed or stagnant due to lack of capital. These include the Noi Bai-Ha Long Expressway, Hanoi’s belt route No. 5, construction of the Da River surface water plant, and the coastal route through five localities.

Seeking solutions

Officials of localities and business representatives attending the workshop proposed speeding up planning for the Red River Delta and localities in the region to remove infrastructure bottlenecks and promote regional linkages for socioeconomic development.

Ass.Prof. Dr. Nguyen Hong Son, Deputy Head of the Party Central Committee's Economic Commission

Pham Duc Thanh, Deputy Director of the Thai Binh Planning and Investment Department, asked localities to increase cooperation in socioeconomic development planning, infrastructure development, production and trade, and formation of production and consumption chain linkages between businesses in order to bring into play the advantages of each locality as well as the effects of sustainable development projects.

Minister of Planning and Investment Nguyen Chi Dung spoke about measures to promote economic development in the Red River Delta. Specifically, he urged improved mechanisms and policies for regional linkage development; promotion of high-tech industries; and development of organic, circular agriculture in conjunction with building new-style rural areas. The Red River Delta is also expected to become a science and technology hub for creative innovation and digital transformation.

“It is necessary to attract investment in logistics, wholesale markets, smart warehousing facilities and entrepots associated with seaports, airports and border crossings in Hanoi, Hai Phong and Quang Ninh to bring into full play the advantages of the Red River Delta, promoting intraregional, interregional and foreign trade. Delta localities should take advantage of free trade agreements to attract investment,” Deputy Minister Do Thang Hai emphasized.